HomeMy WebLinkAboutResolution 1452_ ~, ,
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CITY OF FORT WORTR
COIINCIL RESOLUTION NO. /~5~
WHEREAS, the enhancement of the tax base and the local
economy will benefit the citizens of the City of Fort Worth,
Texas; and
WHEREAS, Texas Legislature has enacted laws regarding tax
abatement which permit the cities of the State of Texas to
participate in such programs as a direct means of assisting in
the retention and expansion of primary employment and to help
allow major investment to the City which would be a benefit to
the property in the City as well as the taxpayers and citizens;
and
WHEREAS, the provision of certain economic development
incentives may encourage the development or redevelopment of
commercial/industrial projects in the City of Fort Worth; and
WHEREAS, the creation of a specified reinvestment zone will
be likely to contribute to the retention or expansion of primary
employment or to attract major investment that would be a benefit
to the property and that would contribute to the economic
development of the City of Fort Worth; and
WHEREAS, the Property Redevelopment and Tax Abatement Act,
V.T.C.A., Tax Code, Chapter 312, allows cities to establish local
guidelines and criteria for tax abatement agreements which are a
prerequisite for designation of reinvestment zones; and
WHEREAS, the establishment of specific criteria, guidelines
and procedures are necessary to effectively and fairly administer
the provision of economic development incentives; and
WHEREAS, state law requires the adoption of criteria and
guidelines governing the establishment of tax abatement
agreements; and
WHEREAS, on March 21, 1989, Resolution #1401 was adopted
declaring that the City of Fort Worth elects to become eligible
to participate in tax abatement and established criteria and
guidelines for tax abatement td qualified downtown residential
projects.
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CITY OF FORT ItlORTH
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NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
FORT WORTH., TEXAS:
SECTION I. THAT the City of Fort Worth hereby establishes a
Policy Statement on Tax Abatement to Qualified
Commercial/Industrial Projects in the City of Fort
Worth, attached hereto as Exhibit "A" and which
Exhibit "A" is incorporated herein as if copied in
its entirety and is approved, and which document
w contains and establishes guidelines, criteria and
w procedures governing tax abatement agreements to
qualified commercial/industrial projects.
SECTION II. THAT the City of Fort Worth amends the Policy
Statement it adopted in Resolution #1401 to
establish a Comprehensive Policy Statement on Tax
Abatement which consists of the Policy Statement
on Tax Abatement to
a.) qualified downtown residential project, and
b.) qualified commercial/industrial projects.
SECTION III. THAT the criteria and guidelines established
within the Comprehensive Policy Statement on Tax
Abatement to qualified Residential and
Commercial/Industrial Projects in the ,City of r^ort
Worth shall expressly govern all subsequent tax
abatement agreements, as required by State law.
SECTION.IV. THAT the City Secretary is hereby authorized and
directed to deliver to the presiding officer of
each affected taxing unit a copy of the Tax
Abatement policy, and notice that the City of Fort
Worth may establish reinvestment zones and enter
into tax abatement agreements.
SECTION V. THAT this resolution shall take effect from and
after its final date of adoption, and it is
accordingly so ordered.
C1TH OF F08T NORM'S
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ADOPTED,~~I' THE CI Y CO CIL OF THE CITY OF FORT WORTH, TEXAS
THIS day of A.D., 1989.
Bob Bolen
Mayor
ATTEST:
City Secretary
APPROVED BY
APPROVED AS TO FORM: CITY GOUNCII
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City Attorney "" """r
Chy $earetaty of the
Cltp of F,ox WoxL, Tmtoe
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CITY OF FORT WORTS
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POLICY STATEMENT REVISED FOLLOWING 8-1-89 WORIC SESSION AND SIIBMZTTED
TO CITY COUNCIL FOR ACTION ON 8-1-89
EXHIBIT "A"
CITY OF FORT WORTH POLICY STATEMENT
ON TAX ABATEMENT TO
QIIALIFZED COMMERCIAL/INDUSTRIAL PROJECTS
(GIIIDELINES AND CRITERIA)
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I. GENERAL PIIRPOSE AND OBJECTIVES
The City of Fort Worth is committed to the promotion of high quality
development in all parts of the City, and to an ongoing improvement in
the quality of life for its citizens. Insofar as these objectives are
generally served by the enhancement of the tax base and expansion and
diversification of the local economy, the City of Fort Worth will, on
a case-by-case basis, give consideration to providing tax abatement,
pursuant to the Property Redevelopment and Tax Abatement Act,
V.T.C.A., Tax Code, Sections 312.001 through 312.209, as from time
to time amended, as a stimulation for economic growth and
diversification in Fort Worth. Priority consideration will be given
to those projects which result in little or no additional cost to the
city and/or projects which create greater than 1,000 new .jobs. It is
the policy of the City of Fort Worth that said consideration will be
provided in accordance with the guidelines, criteria and procedures
outlined in this document. Nothing herein shall imply or suggest that
the City of Fort Worth is under any obligation to provide tax
abatement to any applicant. All applicants shall be considered on a
case-by-case basis.
According to Texas law, Property Redevelopment and Tax Abatement Act,
V.T.C.A., Tax Code, Chapter 312, the City of Fort Worth may grant tax
abatement on the incremental value of a particular property that is
improved pursuant to a specific development proposal which meets the
economic goals and objectives of the City. The abatement will apply
only to the incremental increase in valuation. The abatement will
also apply to tangible personal property located in the reinvestment
zone after the execution of an abatement agreement, including
inventory and supplies of certificated air carriers (Note: Senate
Bill 1312 and House Bill 2043, Acts of the 71st Legislature, Regular
Session, 1989). Tax abatement will not be ordinarily considered for
projects which would be developed without such incentives unless it
can be demonstrated that higher development standards or other
• development and community goals will be achieved through the use of
the abatement.
Based on the general purpose and objectives and in compliance with the
\ intent and tenets of the Texas Property Redevelopment and Tax
Abatement Act, the City of Fort Worth will establish reinvestment
zones for economic development purposes. Within the reinvestment zones
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there will be permitted tax abatement of the increase in value of
real and tangible personal property, including inventory and supplies
for certificated air carziers. Tax abatement will be offered only
within designated reinvestment zones and only to those industries
identified in Section III, Definitions, "Eligible Industries".
II. CRITERIA
Any request for tax abatement shall be reviewed by the City staff for
~'' recommendations to the City Council. Its determination shall be
based upon an evaluation of the following criteria and any other
relevant information and material, which each applicant will be
requested to address in narrative format. Any proposed project must
conform to the general guidelines specified below:
* Any request for tax abatement must involve a development project,
excluding land, with either (i) a minimum incremental increase in
value of 25 million dollars or (ii) a minimum cost of 25 million
dollars.
* The project must make a substantial contribution to development
efforts in the City by enhancing either additional development
activity or furthering redevelopment and preservation activities
within special planning areas or be located in a special
development zone of the City such as an Enterprise Zone.
* The project must have high visibility, image impact or be of a
significant)y higher level of development quality than that which
currently exists in the City.
* The project must serve as a catalyst and prototype for additional
development of a higher standard or development of an additional
industry which has been identified to be an asset to the community.
* The project must generate a higher concentration of employment
potential than would otherwise be achieved.
* The project must enhance property value and complement other land
uses in the project vicinity.
Applications for tax abatement incentives should provide a written
narrative detailing how the proposed project relates to the criteria
established above and the issues listed below. In addressing the
following issues, the applicant should indicate the appropriate time
frames in which the proposed events and/or resulting impacts will
• occur, where applicable.
Additionally., it is understood the information provided will be, out
of necessity, estimates only. The applicant should endeavor to
,,,provide the most accurate estimates possible based upon available
information. The applicant may be requested by the City to describe
the logics/methodologies utilized to supply supporting documentation.
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EMPLOYMENT IMPACT
Number of new jobs created in Fort Worth.
Percentage of new employees which will
(a) come from outside the City of Fort Worth and
(b) from outside the State of Texas
Types of jobs created.
Total projected annual payroll of the newly created jobs.
PROPDSED IMPROVEMENTS
Identify and describe the kind, number and location of all proposed
improvements to the property, as well as the land area and cost, and
discuss the development schedule of the proposed improvements. In
addition, City staff may request the square footage of the proposed
project.
Identify the infrastructure construction which will be required to
serve -the proposed project and the estimated cost of said
construction.
FISCAL IMPACT
Amount of real and tangible personal property value added to the tax
. rolls.
Amount of direct sales tax generated.
Proposed project's effect on existing businesses and/or office
facilities.
Cost to the City of Fort Worth to provide municipal services to the
proposed project.
COMMQNITY IMPACT
Effect of the proposed project on the local housing market.
Environmental impact, if any, created by the project.
Compatibility of the proposed project with the City's comprehensive
• plan.
Rezoning and platting/replatting required.
Impact on local school districts.
Impact on the County government.
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Impact on all other taxing entities.
Impact on the City of Fort Worth.
The criteria outlined in this section will be used by the City staff
to determine whether or not to recommend to the City Council that it
is in the best interest of the City of Fort Worth and other affected
taxing entities that tax abatement be offered to a particular appli-
cant. Specific considerations will include the degree to which the
~ individual project furthers the goals and objectives of the community,
as well as the relative impact of the project on the community.
III. DEFINITIONS
"Eligible Industries": Certain types of business investment show high
promise of creating new jobs, new income and positive economic
spill-over effects beneficial to the City. As a result, tax
abatements will be eligible only to certificated air carriers
and industries in Major Group 45, "Transportation by Air", as
described in the Standard Industrial Classification Manual, U.S.
Office of Management and Budget, 1987. A copy of Major Group 45 of
the SIC Manual is attached hereto and made apart hereto by reference.
IV. GIIIDELINES
.After following sand complying with all statutory and other .require-
ments and after a determination is made that a tax abatement agreement
should be .entered into with the applicant, the value and -term of the
• abatement will be determined by the following guidelines:
MINIMIIM ELIGIBILITY REQIIIREMENTS
1. The project must be an eligible industry as defined in Section
III. Definitions.
2. The investment in new facility (structural improvements to land)
must result in a structure or structures having either a minimum
added value of twenty-five million dollars (excluding land) or a
minimum cost of twenty-five million dollars (excluding land}.
3. The project must comply with all criteria defined in Section II.
above.
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TAX ABATEMENT LIMITATIONS
~ 1. The rate of tax abatement for any tax year shall be 1000 of the
-.. incremental increase in value of real property and tangible
personal property, including inventory and supplies of the
certificated air carriers.
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2. In order to qualify for the (100%) tax abatement, the owner of the
subject property must meet the following minimum threshold
eligibility requirements:
a. Construct and equip within the reinvestment zone a structure
or structures having either a minimum added value of
twenty-five million dollars (excluding land) or a minimum cost
• of twenty-five million dollars (excluding land).
'~ 3. To determine if the project meets the minimum eligibility
requirement, the applicant will certify to the City Manager's
Office the cost of the new improvements for which the abatement is
requested.
4. The tax abatement period shall not exceed fifteen (15) years.
5. Any tax abatement granted a project will 'become effective on
January 1 of the year following the issuance of a Certificate of
Occupancy (CO) for the new facilities unless otherwise specified
in the tax abatement agreement. The total acreage of the project
shall be assessed at 100 percent market valuation upon execution
of the abatement agreement, unless otherwise addressed in the tax
abatement agreement.
6. If a project is not completed as specified in the tax abatement
agreement, the City has the right to cancel the abatement
agreement and abated taxes shall become due to the City and other
affected taxing units as provided by law.
• V. PROCEDD'RAL GIIIDELINES
Any person, partnership, organization, corporation or other entity
desiring that the City of Fort Worth consider providing tax abatement
to encourage location of operations within the city limits of Fort
Worth shall be required to comply with the following procedural
guidelines. Nothing within these guidelines shall imply or suggest
that Fort Worth is under any obligation to provide tax abatement in
any amount or value to any applicant.
Preliminary Application Stevs
A. Applicant shall submit an "application for tax abatement"
B. Applicant shall address all criteria questions outlines in Section
• II above in letter format.
C. Applicant shall prepare a survey map showing the precise location
of the property, all roadways within five hundred (500) feet of
~ the site, all existing land uses and zoning within five hundred
(500) feet of the site and the kind, number and location of all
proposed improvements.
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D. City may request applicant to provide substantiation of the
economic feasibility of the overall project to assist in
determining the long term benefit to the City.
E. A complete legal description of the property shall be provided.
F. Applicant shall complete all forms and information detailed in
items A through E above and submit them to the City Manager, City
of Fort Worth, 1000 Throckmorton, Fort Worth, Texas 76102.
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Arvlication Review Stens
G. All information in the application package detailed above will be
reviewed for completeness and accuracy. Additional information
may be requested as needed.
H. The application may be distributed to the appropriate City
departments for internal review and comments. Additional
information may be requested as needed.
I. Copies of the complete application package and staff comments will
be provided to the City Council.
Consideration of the Avnlication
J. The City Council will consider the application at meetings
conducted pursuant to the Open Meetings Act and the Property
• Redevelopment and Tax Abatement Act. Additional information may
be requested as needed.
R. The City Council may consider a resolution calling a public hearing
to consider establishment of a reinvestment zone.
L. The City Council may hold the public hearing and determine whether
the creation of the reinvestment zone would contribute to the
retention or expansion of primary employment or would attract
major investment in the zone and would contribute to the economic
development of the City.
M. The City Council may consider adoption of an ordinance designating
the area described in the legal description of the proposed
project as a commercial/industrial reinvestment zone for tax
abatement.
• H. The City Council may consider adoption of a resolution which
approves the terms and conditions of an agreement between the City
and the applicant, and governs the provision of the tax
abatement. At minimum, the agreement shall include the
'~ following:
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1. General description of the project;
2. Amount of the tax abatement
3. Duration of the abatement;
4. Type, number, location and time table of planned
improvements; and
5. Any specific terms and conditions to be met by the applicant.
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O. The governing bodies of any affected independent school district,
Tarrant County or Denton County, and all other applicable taxing
units may consider ratification of and participation in the tax
abatement agreement between the City of Fort Worth and the
applicant.
P. Should the terms of the agreement not be satisfied, the tax
abatement shall be subject to cancellation as provided in the tax
abatement agreement, and all abated taxes shall be paid to the
City of Fort Worth and all other taxing jurisdictions
participating in the tax abatement agreement as provided by law.
If a project granted a tax abatement ceases to operate or is no
longer in conformance with this policy statement, the tax
abatement agreement shall not be in effect for the period of time
during which the project is not operating or is not in
conformance. The City of Fort Worth may negotiate with the
reeipient of a tax abatement to waive the recapture provisions or
to terminate the agreement.
Q. The City of Fort Worth reserves the right to verify the
applicant '.s credit worthiness prior to granting a tax abatement
and to review the financial condition of the project during the
term of ,the abatement. The City of Fort Worth also.reserves the
right for a representative to inspect the facilities of the
applicant during the term of the abatement and to verify the
information provided in the tax abatement agreement. Provisions
to this effect shall be incorporated into the agreement.
VI. EFFECT OF SALE, ASSIGNMENT OF LEASE OF PROPERTY
No tax abatement rights may be sold, assigned, or leased unless
otherwise specified in the tax abatement agreement. Any sale, assign-
ment or' lease of the property which is not permitted in the tax
abatement agreement results in a forfeiture of all tax abatement
rights as to the property sold, assigned or leased, unless the City
agrees to ratify the transfer.
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G-8147 POLICY STATEMENT DN TAX ABATEMENT TO
OIIALIFIED COMMERCIAL/INDIISTRIAL PROJECT
~r MOVE~TD ADOPT MfiC G-8147 WITH THE ONE CHANGE
THAT THE POLICY STATEMENT PROVIDE FOR A HINIMIIM
PROJECT AMOIINT OF.$25 MILLION RATHER THAN $50
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